Is It Life Insurance Or Life Assurance?

We invest a lot of time and money into different financial products and it can sometimes become difficult to keep up with what tasks different products perform. For example, take life insurance and life assurance: most people do not know that there even is a difference between these two products, never mind what the difference is.

If you don't know the basics of the insurance industry: what the different types of products are, what they offer, what they cover and what not, you simply can not make the right decision. You can also get the best service of life assurance via

Some people, not knowing what they are purchasing and what the policy covers, will then just settle for any type of policy, often being under-insured and paying too much.

Life insurance insures you for a specific amount of time, known as the policy term. If the insured were to die within this period, the insurance company will pay out the claim to the insured's nominated beneficiaries.

However, if you take out a policy for a certain amount of time and outlive this term or period, the policy will have no residual value whatsoever, meaning that the policy ends without the policy holder receiving any money.

The policy only ever has any value in the event of a claim. Life insurance covers the costs of an event that might happen. If an event happens in the coverage term, they will pay out a claim. If not, the policy finishes and they have no remaining value.

Life assurance, on the other hand, is completely different from life insurance. Life assurance policies will pay out a claim in the occurrence of an event that is certain to happen. Assurance policies always pay out, either in the event of dying or reaching a specific age.

That is why it is used as a method of life insurance and retirement savings. In the event of the policy holder or insured dying within the coverage term or while the policy is still active, the insurance company will pay out a claim to the insured's nominated beneficiaries to compensate for their income and to support them financially.

This is the insurance element of the policy. There is also an investment element in a life assurance policy. The assurance provider will take a portion of the insured's monthly premium and invest it. By the time the insured reaches a specific age, like 65, the assurance provider will pay out the invested amount accumulated over time.